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Bill Lipschutz, Hathersage Capital Management

Hathersage Capital Management - Best Foreign Exchange Hedge Fund


Hathersage Capital Management LLC is a discretionary global macro investment manager founded in 1991. The firm is a foreign exchange specialist, expressing its global macro views strictly in G10 currencies, using interbank spot, forwards and vanilla options. 

The portfolio management team at Hathersage has a wealth of experience in the foreign exchange markets. Members of the team have been managing substantial FX-only portfolios for more than three decades. The team combines that experience with its knowledge of options pricing and options trading in structuring a portfolio of directional exposures based upon fundamental macroeconomic analysis. 

In today's marketplace, investors have begun to take notice of the several absolute return currency strategies currently available which provide low or negative correlation with global equities or equity beta. 

In the case of Hathersage's macro strategies, a closer look reveals historically low or negative correlation when global equities are rising and highly negative correlation when global equities are falling dramatically (defined as an MSCI price change greater than 1 standard deviation). In other words, when global equities have experienced extreme downside market dislocation, Hathersage's macro strategies have produced outsized gains.

On the Citi Access Managed Investment Platform, the Hathersage G10 Macro Access Strategy, a strategic macro portfolio, was the top performer in 2016, returning 38.39 per cent. The strategy has generated a 23.49 per cent annualised return since the inception of the platform in 2011 – number one on the platform. 

Hathersage also offers a more traditional tactical momentum-based strategy, the Hathersage G10 Daily Access Strategy, on the Citi Access Platform. This strategy, up 10.54 per cent last year and having generated 11.51 per cent annualised gains with an IR exceeding 1.25 since inception, has also exhibited low negative correlation with global equities over its life. 

"Although the drivers affecting currency pair valuations can change very quickly and prices can move accordingly, the currency markets remain the most liquid of all financial markets. It is this depth of available liquidity that allows for tremendous scalability in G10 absolute return strategies,” comments Bill Lipschutz (pictured), principal, CIO and head of portfolio management. 

This means that equity centric portfolios can invest in enough size to find meaningful diversification through active currency managers. Though Hathersage is considered a boutique manager as far as global macro goes, Lipschutz doesn't mind, stating that "while the firm has plenty of capacity, it continues to position itself first and foremost as a return generator not as an asset gatherer". 

On winning this year's award, Lipschutz says: "Organisations such as Hedgeweek in part serve to shine a light on the many talented service providers in our financial industry. We are honoured to be included in such esteemed company."

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